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The Honolulu Advertiser
Posted on: Sunday, February 15, 2009

AFTER DEADLINE
Newspaper won't take federal bailout

By Mark Platte
Advertiser Editor

An elderly woman was on the phone last week tired of all the stories about newspapers shrinking, losing employees, consolidating sections, turning tabloid, cutting back on pages and hemorrhaging revenue.

"What you need," said the woman, "is a government bailout."

She explained that newspapers were essential to our democracy and simply could not go out of business. As she worked up a head of steam and asked which elected officials she could contact, I politely stopped her. No media organization that considers itself a check on our public officials would accept a government bailout that could be construed as influencing our coverage.

Some have suggested that newspapers take advantage of endowments or be run as nonprofits because they are essentially public trusts. But there are problems inherent in some of these structures as they, too, are subject to financial conditions and specific laws that govern them. Some have joked that newspapers are already nonprofits because they don't make money.

We at The Advertiser and elsewhere have to come up with a working business model that pays for journalists, ad salespeople, production workers, creative marketers, newspaper deliverers, accountants and human resources representatives. We have to figure out how to keep advertising and circulation revenue coming in the door as print readers migrate in increasing numbers to our Web site, which attracts a far smaller ratio of ad dollars and no subscription rates.

If we could turn back the clock, would we all have charged for the content on our Web sites rather than giving it away? Certainly. Can we develop a method to start charging for it now? Hard to say, when readers (particularly young ones) are in the habit of getting just about any content (including music, video and games) for free. Would every newspaper even agree to follow the same paid model, knowing that the few that didn't would attract the most readers? That remains to be seen.

Walter Isaacson, in the current issue of Time magazine, argues for a new payment system for online news.

"The key for attracting online revenue is coming up with an iTunes-easy, quick micropayment method," he writes. "We need something like digital coins or an E-Z Pass digital wallet — a one-click system that will permit purchases of a newspaper, magazine, article, blog, application or video for a penny, nickel, dime or whatever the creator chooses to charge."

The Wall Street Journal still maintains a paid Web subscription, one of the few that do. Some that have charged for premium content, such as the New York Times for its columnists and the Los Angeles Times for its entertainment coverage, have since made that information free on their sites.

Whatever the business model, I believe that readers will always want professionally reported, written and edited stories and that the credibility of The Advertiser and other news organizations will be of value whether in print or digital form. What readers or advertisers are willing to pay in future years has yet to be determined, but we will survive it in some form and it won't come from a government handout.